After Saral, it's time for Sugam

TAX ADMIN: Government looks at e-filing of returns and e-payment of taxes to improve tax administration

Filing income tax returns in the coming assessment year should be a much simpler task for small taxpayers. Introducing a form similar to the ‘Saral’ form, Finance Minister Pranab Mukherjee proposed to bring in ‘Sugam’ in his Budget speech on Monday. Sugam, the Hindi word for accessible, is a simplified form that aims to reduce the compliance burden of taxpayers like small businesses and professionals.

But this is just one of the many tax administration measures announced by the FM to make taxation procedures more efficient. The objective seems to be to get the system aligned to the web platform, with several initiatives being worked out to popularise e-payment and e-filing of income tax and tax deduction at source (TDS) returns.
 

KEEPING IT SIMPLE AND QUICK  

* Expansion of e-filing and e-payment services 

* Payment of commercial taxes inclusive of stamp duty

* Tracking of refund resolutions through internet 

* More Settlement Commission benches proposed for quick disposal of cases

"According to the proposal, the Central Board of Taxes (CBDT) has been asked to work on simplifying e-payment and e-filing to the extent where, once the TDS has been deducted for salaried individuals, subject to certain other conditions, the person may not have to file returns seperately," says Pranay Bhatia, Associate Partner, Economic Laws Practice.

Both CBDT and The Central Board of Excise and Customs (CBEC) will adopt the 'Sevottam' concept.

“The government wants to reduce the compliance burden and administrative burden for both the taxpayer and the tax collector. The steps announced aim to reduce the interface between the two,” said Vikas Vasal, executive director, KPMG.

With a view to modernise tax administration throughout the country, the government will fund a new scheme with an outlay of Rs 300 crore to assist states in modernising their stamp and registration administration. E-stamping, which is prevalent in only six states right now, is expected to be rolled out in all the districts in the next three years. Similarly, there is a proposal to bring an amendment to the Indian Stamp Act.

Tax experts believe that with most financial transactions and property registrations increasingly becoming web-based, tax collections from these sections should improve in the coming years.

At the same time, the finance ministry has drawn up a plan to address the biggest grievance that taxpayers have against the Income Tax Department: Delayed tax refunds.

A web-based facility will help a taxpayer track his resolution of refunds and credit for pre-paid taxes. Besides, several steps will be initiated to reduce litigation and focus more on high revenue cases. More benches of the Settlement Commission will be set up to fast-track disposal of pending tax disputes cases.